PwC to look into funding disparities

13th February 2009 at 00:00
Government hires accountants to examine huge inequalities in school grants across the regions

The accountants Pricewaterhouse Coopers has been hired by the Government to assess the vast regional inequalities in school funding.

The gap between the best and worst-funded authorities has grown recently, some receiving twice as much as others. Campaigners have warned the disparities are destabilising school budgets.

Representatives from the worst-funded authorities in England are calling for a rethink of the dedicated schools grant, schools' main source of funding.

A review into the grant has just begun to collect evidence in time for ministers to agree changes by 2010, when schools will be allocated budgets for 2011-2014. PwC will report to the review.

The two-year project, announced by Jim Knight in 2008, was set up to develop a single formula for funding all schools.

The grant consists of a basic amount per pupil, plus three additions to compensate for local area differences, deprivation and scarcity of schools. At present, authorities that do not qualify for high levels of funding for the three additions get money taken off their per-pupil amount.

The F40 group, made up of representatives from the 40 lowest-funded authorities, wants the formula to change so that every area receives the same basic grant. But Treasury officials have eschewed demand-led funding along the lines of the NHS because it is more unpredictable.

Ivan Ould, vice-chair of F40 and a councillor in Leicestershire, the lowest-funded authority in England, said: "In my area, there are schools across the road from each other where the school within the Leicester city boundaries gets Pounds 550 more per pupil. Nationwide this is leading to budget deficits in schools, and heads can't afford to buy the same resources or have the same staffing levels as colleagues elsewhere."

Mike Sladen, a school funding manager in Cambridgeshire - fifth from bottom in the funding league table - said a major problem was the difficulty of measuring rural poverty. "Many of our parents work in agriculture and have low wages, but they don't claim benefits, so the Government doesn't interpret this as deprivation," he said.

A spokeswoman for the Department for Children, Schools and Families said: "The review of DSG is progressing well and we are receiving a great deal of input from stakeholders. This is an open process."

Needs-led? No way

In Gloucestershire, normally about 138th in the funding league table, heads face having to cut back on special needs provision. Despite funding levels rising there because of the Government's decision to give more cash to local authorities near the M4, it says it wants to make savings of Pounds 60 million.

"We just want a system which funds according to needs," said Steve Savory, chairman of the county's primary heads' association and head of Bishops Cleeve Primary near Cheltenham.

He spent months with council officers working on a plan to change local school funding, but his needs-led system cannot be used as the council gets insufficient government funding.

Mr Savory sees primaries not far from his receiving more cash as they have a higher proportion of pupils who are SEN or eligible for free school meals. His school has 215 pupils with SEN action plans, but this does not attract the same funding. His school gets only about Pounds 1,200 per pupil.

In this academic year, the South West is the worst-funded area in the country with an average of Pounds 3,796 per pupil; schools in London get Pounds 4,860. Outside London, the best-funded areas are the North West, with an average of Pounds 4,027, and the West Midlands at Pounds 4,007 per pupil.

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